I. The Statutory Framework

Section 61(a) of the Internal Revenue Code, codified at 26 U.S.C. § 61(a), defines “gross income” with a breadth that its drafters made deliberate and that its interpreters have made absolute:

“Except as otherwise provided in this subtitle, gross income means all income from whatever source derived, including (but not limited to) the following items: (1) Compensation for services, including fees, commissions, fringe benefits, and similar items; (2) Gross income derived from business…”¹

The Supreme Court, in Commissioner v. Glenshaw Glass Co., 348 U.S. 426 (1955), interpreted this provision to reflect Congress’s intention “to exert in this field ‘the full measure of its taxing power.’”² The Court held that gross income encompasses “all gains except those specifically exempted” and that the definition was “broad enough to include all economic gains not otherwise exempted.” Justice Warren, writing for a unanimous Court, left no ambiguity: the statutory language means what it says. All income. From whatever source. Derived.

The statute does not specify that the income must be denominated in United States currency. It does not require that the recipient possess a bank account, a Social Security Number, or a central nervous system. It does not limit its reach to transactions between members of the same biological kingdom. It establishes a single test: did the taxpayer receive an accession to wealth? If so, it is gross income.

This is not a rhetorical observation. It is the foundation of a tax liability that has been accruing, unreported, across all fifty states for approximately 100 million years.

II. The Barter Regulation

Treasury Regulation § 1.61-2(d)(1), promulgated under the authority of Section 61, addresses the specific circumstance in which services are compensated not in money but in kind:

“If services are paid for other than in money, the fair market value of the property or services taken in payment must be included in income.”³

The regulation is bilateral. When a lawyer performs legal services for a housepainter in exchange for the housepainter painting the lawyer’s home, both parties owe tax. The lawyer must include in gross income the fair market value of the housepainting received. The housepainter must include in gross income the fair market value of the legal services received. The regulation does not permit either party to treat the transaction as a gift, a hobby, or an ecologically mediated mutualism. It requires both parties to report.

IRS Publication 525, Taxable and Nontaxable Income, reinforces this rule in language that the Service itself describes as guidance for “everyday” taxpayers: “If you exchange services with another person and you both have agreed ahead of time on the value of the services, that value must be included in the income of both of you.”⁴ The IRS’s own educational video on miscellaneous income states: “When it comes to bartering, the fair market value of goods or services exchanged is taxable and must be reported by both parties on their tax returns.”⁵

The phrase “both parties” does not contain a phylogenetic qualifier.

III. The Precedent

In Revenue Ruling 79-24, 1979-1 C.B. 60, the Internal Revenue Service addressed two fact patterns involving the exchange of services without the use of money.⁶

In the first, a lawyer who was a member of a barter club performed personal legal services for a housepainter. In exchange, the housepainter painted the lawyer’s personal residence. No money changed hands. The IRS ruled that the fair market value of the housepainting must be included in the lawyer’s gross income under Section 61, and that the fair market value of the legal services must be included in the housepainter’s gross income.

In the second, the owner of a small apartment building allowed a professional artist to occupy an apartment rent-free for six months. In exchange, the artist created a work of art for the building owner. The IRS ruled that the fair market value of the artwork must be included in the landlord’s gross income, and that the fair market value of six months’ rent must be included in the artist’s gross income.

The ruling established that barter transactions are fully taxable events regardless of whether money is exchanged. The principle has been upheld consistently in subsequent rulings and case law. In Revenue Ruling 80-52, 1980-1 C.B. 100, the IRS extended the rule to barter club members whose accounts were credited with trade units for goods or services provided: the value of the trade units was includable in income for the taxable year in which credited. In Barter Systems Inc. of Wichita v. Commissioner, T.C. Memo. 1990-125, the Tax Court upheld the IRS’s authority to require barter exchanges to report member transactions.⁷

The factual core of Revenue Ruling 79-24 is this: two parties exchanged services of comparable value. Each received an accession to wealth. Each owed tax. The ruling does not specify that the painter must be bipedal, that the lawyer must be a vertebrate, or that the exchange must occur indoors. It specifies that when services are exchanged, the fair market value of what is received is gross income.

IV. The Bilateral Exchange

The relationship between a flowering plant and its pollinator is a barter transaction. The consideration is explicit, bilateral, and has been documented in peer-reviewed literature for more than a century.

The flower produces nectar, a sugar solution secreted by specialized glandular structures called nectaries. Nectar production is not incidental. It is not a waste product. It is not leakage. It is a metabolic investment. Research published in Nature demonstrated that nectar production can consume up to 37 percent of a plant’s available energy, and that removal of nectar from flowers reduced the plant’s ability to produce seeds—the first experimental demonstration that nectar production entails a measurable reproductive cost to the plant.⁸ Subsequent research confirmed that nectar production costs range from 3.3 percent of daily photosynthate in short-lived flowers to 37 percent in long-lived flowers, with a documented trade-off between nectar investment and plant growth or reproduction.⁹

The flower offers this nectar to the pollinator. The pollinator consumes the nectar and, in the process of collecting it, transfers pollen grains from the anthers of one flower to the stigma of another, effecting cross-fertilization. The flower receives pollination services. The pollinator receives food. Both parties receive value. Both parties incur costs.

This exchange is not casual. It is the product of approximately 100 million years of co-evolutionary negotiation. Flowers have evolved specific petal colors, ultraviolet nectar guides, scent compounds, floral morphologies, and nectar sugar concentrations to attract particular pollinators. Pollinators have evolved specialized proboscises, body hair distributions, and foraging behaviors to extract nectar and pollen from particular flowers.¹⁰ The USDA’s own research arm notes that more than 100 U.S.-grown crops “rely on honey bees and other pollinators.”¹¹ This is not a chance encounter. It is a structured bilateral exchange with consideration flowing in both directions, sustained by the same economic logic that sustains every barter exchange the IRS has ever taxed.

Under Treasury Regulation § 1.61-2(d)(1), the fair market value of the pollination services received by the flower must be included in the flower’s gross income. The fair market value of the nectar received by the pollinator must be included in the pollinator’s gross income. Revenue Ruling 79-24 requires nothing less.

V. The USDA’s Own Valuation

The United States Department of Agriculture has done what neither party to the transaction has done: it has calculated the fair market value.

The USDA’s National Institute of Food and Agriculture reports that “pollinators add more than $18 billion in revenue to crop production every year.”¹¹ The White House, in its 2014 Presidential Memorandum establishing the Pollinator Health Task Force, stated that “honey bee pollination alone adds more than $15 billion in value to agricultural crops each year in the United States.”¹² The same memorandum valued the contribution of native wild pollinators at approximately $9 billion. The American Beekeeping Federation estimates the total at “nearly $20 billion.”¹³

These are the government’s own numbers. They are calculated using standard economic valuation methodologies: the increase in crop yields and crop quality attributable to pollinator services, measured as the difference in market value between pollinated and unpollinated production. This is the same conceptual framework the IRS employs to determine fair market value in barter transactions: the economic benefit conferred on the recipient, valued at the price a willing buyer would pay a willing seller in an arm’s-length transaction.

The USDA has, in effect, prepared one half of the tax assessment. It has valued the services the pollinators provided to the plants. The IRS has not assessed a single dollar of tax on these services. The USDA has quantified $18 billion in annual value. The IRS has reported zero.

VI. The Nectar Side of the Ledger

The barter regulation is bilateral. The flower must report the value of the pollination services it received. The pollinator must report the value of the nectar it received. The USDA has valued one side. Peer-reviewed metabolic research has quantified the other.

Honey—the stored and processed derivative of collected nectar—has a well-established market price. The USDA’s National Agricultural Statistics Service reported that U.S. honey production was valued at approximately $333 million in 2023, and the total annual value of honey bee products and services sold is approximately $700 million.¹⁴ This represents the downstream commercial product of nectar that pollinators collected, transported, enzymatically processed, and dehydrated—a manufacturing operation that peer-reviewed research has shown metabolizes 25 to 60 percent of the sugar in the nectar during dehydration alone.¹⁵

The raw nectar itself—the consideration paid by the flower at the point of exchange—has been characterized in the scientific literature. A single honeybee colony consumes an estimated 120 to 200 kilograms of nectar per year to sustain its activities, of which approximately 60 to 80 kilograms are converted to honey for storage. The approximately 2.7 million managed honeybee colonies in the United States collectively consume nectar-derived energy in quantities that, valued at honey commodity prices, represent hundreds of millions of dollars per year. The 4,000-plus species of native wild bees, plus butterflies, moths, flies, beetles, hummingbirds, and bats, consume considerably more.¹⁶

The IRS does not require that the fair market value of barter income be calculated to the penny. It requires that a reasonable estimate be reported. The USDA has published the pollinator side. The honey market has priced the nectar side. The reporting obligation for both is clear. The reporting rate for both is zero.

VII. The Scale of Unreported Commerce

The individual transaction count defies the IRS’s conventional reporting infrastructure.

A single honeybee makes 10 to 12 foraging trips per day, visiting 50 to 100 flowers per trip.¹⁷ Each visit is a discrete barter transaction: the bee collects nectar and pollen from the flower; the flower receives pollen deposited from a prior visit. A typical managed colony contains 20,000 to 60,000 foraging-age workers during peak season. The American Beekeeping Federation estimates that approximately 2.7 million managed colonies operate in the United States, two-thirds of which travel the country each year pollinating crops.¹³

A conservative calculation: 2.7 million colonies, each fielding 25,000 active foragers, each conducting 10 trips per day, each visiting 75 flowers per trip, operating over a 200-day foraging season. The product is approximately 10 trillion individual barter transactions per year from managed honeybees alone.

The USDA reports that there are “more than 4,000 types of bees in the United States.”¹¹ Native wild bees, many of which are solitary rather than colonial, contribute additional trillions of unreported transactions. Butterflies, moths, hawkmoths, hover flies, bee flies, beetles, wasps, hummingbirds, and nectar-feeding bats add further unquantified volumes of unreported taxable commerce.

The IRS processed approximately 163 million individual income tax returns in fiscal year 2024.¹⁸ The pollination economy generates roughly two orders of magnitude more individual taxable transactions per year than the entire American human population generates returns. Not one of these transactions has appeared on a Schedule C, a Form 1099-B, or any other information return filed with the Internal Revenue Service.

VIII. The Reporting Obligation

The Tax Equity and Fiscal Responsibility Act of 1982 (TEFRA) established information reporting requirements for barter exchanges. Congress recognized that barter transactions, though taxable since the enactment of the Sixteenth Amendment, were routinely unreported because no third-party reporting mechanism existed. TEFRA addressed this by classifying barter exchanges as “brokers” under Section 6045 of the Internal Revenue Code and requiring them to file information returns with the IRS.¹⁹

Section 6045(c)(3) defines a “barter exchange” as “any organization of members providing property or services who jointly contract to trade or barter such property or services.”²⁰ A barter exchange must file Form 1099-B for each member, reporting the value of transactions during the taxable year.

The co-evolutionary system of angiosperm pollination is an organization. Its members provide property (nectar, pollen) and services (pollen transfer, seed fertilization). They jointly contract—through the biological mechanism of co-evolved signaling, in which flowers produce specific chemical attractants and pollinators respond with specific foraging behaviors—to exchange these goods and services on a recurring basis. The exchange has been operating continuously, across what is now the territorial United States, since the mid-Cretaceous period.¹⁰

No Form 1099-B has been filed. No barter exchange operator has registered with the IRS. No member of the exchange has obtained a Taxpayer Identification Number under Section 6109. The IRS has assessed information return penalties under Section 6721 against human barter exchange operators for failures to file that involved transactions valued in the thousands of dollars. It has not assessed a single penalty against an exchange facilitating $18 billion in annual transactions.

IX. The Agricultural Defense

The agricultural industry and, presumably, the floral community would raise two objections. Both fail.

First, that pollination is not a “transaction” because neither party has the cognitive capacity to form a contract. This objection confuses contract law with tax law. The Internal Revenue Code does not require contractual capacity. It requires income. Section 61(a) applies to “all income from whatever source derived.” It does not add “by parties capable of understanding the tax code.” The IRS has taxed income received by minors who cannot legally contract. It has taxed income received by persons under guardianship. It has taxed income received by estates of deceased persons. It has taxed income received by trusts, which are legal constructs without biological existence of any kind. The capacity to form a contract is irrelevant to the existence of gross income.²¹

Second, that the government cannot simultaneously value pollination at $18 billion per year for the purpose of justifying federal research expenditures and claim that the same services have no taxable value. The USDA’s own website states that pollinators “add more than $18 billion in revenue to crop production every year” and that “all of us rely on pollinators to provide crucial support for our ecosystem, food system and economy.”¹¹ The fair market value is established. The services were rendered. The consideration was paid. The government has quantified both sides. It has taxed neither.

There is no Section 61 exemption for transactions conducted between members of different phyla. There is no Treasury Regulation carve-out for income received in the form of simple sugars. Revenue Ruling 79-24 does not specify that the painter must be human. It specifies that when services of value are exchanged, the fair market value of what is received constitutes gross income.

X. The Enforcement Asymmetry

The IRS has pursued barter income with increasing vigor since Revenue Ruling 79-24. In Revenue Ruling 80-52, the Service taxed barter club trade units. In Revenue Ruling 83-163, 1983-2 C.B. 26, it taxed members of a barter club who agreed to provide services at the request of other members in exchange for future services. During the 1980s, the IRS instructed field agents to question taxpayers during audits about barter activity and to scan returns in selected categories for deductions of barter club fees. TEFRA imposed third-party reporting requirements. The IRS issued Notice 2014-21 extending the barter framework to virtual currencies, treating cryptocurrency as property that, when exchanged for services, generates taxable income at fair market value.²²

The Service has applied Section 61 to income received in cash, in property, in services, in trade units, in loyalty points, in cryptocurrency tokens, and in non-fungible digital images of cartoon apes. It has applied the section to income received in legal services, housepainting, rent-free housing, artwork, plumbing repairs, and accounting work. It has applied the section to income received by individuals, partnerships, corporations, trusts, estates, and decedents.

It has not applied Section 61 to income received in nectar.

The housepainter in Revenue Ruling 79-24 exchanged services with one lawyer. The enforcement action produced a published revenue ruling. The average honeybee colony exchanges services with millions of individual flowering plants per season. The cumulative value of the unreported exchange exceeds $18 billion per year. The enforcement response has been zero revenue rulings, zero notices of deficiency, zero summonses, and zero collection actions in at least 100 million years of continuous commercial activity.

XI. Conclusion

The Internal Revenue Code defines gross income as “all income from whatever source derived.” The Treasury Department’s own regulation provides that services paid for in property or other services are taxable at fair market value. Revenue Ruling 79-24 applied this principle to a lawyer and a housepainter who exchanged services without the use of money. The IRS held that both parties owed tax on the fair market value of what they received.

Flowers produce nectar—a sugar solution synthesized at a metabolic cost of up to 37 percent of the plant’s available energy—and deliver this nectar to pollinators in exchange for pollen transfer services. The USDA has valued the pollinator’s side of this exchange at more than $18 billion per year. The American Beekeeping Federation estimates 2.7 million managed honeybee colonies. The USDA reports more than 4,000 native bee species. The co-evolutionary exchange has been operating continuously across all fifty states for approximately 100 million years.

The IRS assessed taxes on a barter club in Wichita, Kansas, for failing to report member exchanges valued in the thousands of dollars. It has not assessed a single dollar of tax against a single participant in the $18 billion annual pollination economy. The statute does not contain a botanical exemption. The regulation does not contain a pollinator carve-out. Revenue Ruling 79-24 does not specify that the painter must be human.

The housepainter’s taxable income was the fair market value of the legal services received. The bee’s taxable income is the fair market value of the nectar consumed. Both received value. Neither filed a return. One was assessed taxes. The other has been operating for 100 million years without an audit.

The compliance gap is approximately four inches wide and 100 million years long.

Ergo.